Housing Consumer Protection Bill: consideration of proposed amendments

Meeting report

Opening remarks by Chairperson

The Chairperson officially opened the meeting. He said it was of utmost importance that the Housing Consumer Protection Bill be finalised as it was the same Bill that had given rise to the establishment of stakeholders such as the National Home Builders Registration Council (NHBRC), and protected consumers against construction and housing malpractices. The responses of all concerned provinces and the Department of Human Settlements (DHS) would be heard and considered. Provinces would be consulted once again for their final mandates before the proposed Amended Bill would be submitted back to the Portfolio Committee on Human Settlements in a few weeks’ time.

Apologies

No formal apologies had been received.

The Chairperson welcomed the Department to make its presentation.

Department of Human Settlements Briefing

Mr Paul Masemola, Acting Chief Director: Legal Services, DHS, stood in for Ms Sindisiwe Ngxongo, Chief Operations Officer, who encountered connectivity challenges. Mr Masemola was present alongside the NHBRC executive board, and other department delegates. This presentation would address the issues excluded from the C-List, with some of the issues having already been discussed in previous meetings.

The following responses were received from the nine respective provinces:

• The Eastern Cape’s response to the amendment of Clause 89 (1) was that all employees or staff of Council were regulated in terms of the Labour Laws (which included the Labour Relations Act, Basic Conditions of Employment Act). The Code of Conduct for board members was applicable because they were not employees. As such, the proposed amendment was not necessary.
• Gauteng’s response to Chapter II of the Bill was that the Bill did not provide for owner builder exemptions, as all homes constructed had to be enrolled. Exemptions were granted for exceptional circumstances which could not be predicted. These exceptional circumstances had to be in the public interest. The Minister was permitted to exempt certain persons or homes belonging to a category or class specified in the notice from provisions of this Act, either generally or subject to such conditions as may be specified. The NHBRC would enrol homes where building plans were approved in terms of the National Building Regulations and Building Standards Act, Act 103 of 1977. It was not expected that there would be a huge influx of applications for exemptions. As such, the amendment was not necessary.
• Limpopo and North West Province responded to the proposed amendment of Clause 40 (2) by stating that the warranty cover for roof leaks was currently one year and the Bill proposed that it be extended to two years, post-occupation. In addition, the warranty was proposed to commence on date of construction. Weather conditions were factored into considering the life span of a roof. If a roof was able to withstand all conditions within a period of two years, then it had been properly constructed and any further issue after a period of two years would ordinarily be maintenance related. It was important to note that the Minister was empowered to extend the period of the warranty cover, after the Council had undertaken an actuarial assessment to determine whether the home warranty fund is able to provide for the additional period. The enrolment fee had to be proportionally adjusted in accordance with the extended period of the warranty cover. Clauses 40(3), (4) and (5) further enabled extension of the cover, however cautioning that sufficient funds had to evidently be available. As such, the amendment was not necessary.
• North West further responded to the proposed addition of a provision to make section 24(1)(h) compliant with the Employment Act, by proposing that the register include the foreign national’s employees valid work permit, may burden the NHBRC to enforce the mandate of the Department of Labour and the Department of Home Affairs. The home builder had a responsibility to ensure compliance with all applicable legislation. All home builders who were foreign nationals were required to have and produce valid work permits when they registered or enrolled the home with the NHBRC (this would be included in the regulations and policies of the NHBRC). The issue of employment of foreign nationals by any employer fell within the mandate of the Department of Labour. As a result, the amendments were not necessary.
• The Western Cape responded to three proposed amendments;

1. Clause 5(c) was amended due to the omission of an article [“the”], which the province found useless to amend as it did not affect the meaning of the clause, rendering the amendment unnecessary.
2. The amendment to clause 61 aimed to address a numerical order error in listing of sub-clauses. The province stated that it was not necessary to list cross-referencing in order of numbers; what was important was the substance and content following the cross-referencing numbers.
3. In response to the proposed amendment to section 67, which addressed the use of the word “adjudicate,” the province stated that the word “adjudicate” was more generic and facilitated alternative dispute resolution processes that could be followed such as mediation, negotiation, conciliation and arbitration. “Adjudicate” was used as a verb in this instance.

(see attached for full presentation)

Housing Consumer Protection Bill [B10-2021]

Mr Masemola further presented the proposed amendments to the Housing Consumer Protection Bill [B10B-2021], which were mostly term substitutions, additions or omissions. These had been proposed in prior committee meetings.

(see attached)

Deliberations

Mr R Badenhorst (DA, Western Cape) said the Western Cape had submitted various inputs on 31 July 2023, however only three of these inputs were presented in the current meeting - what was the reason for the omission? If responses for other inputs had been given in prior meetings, where could they be accessed?

Ms S Shaikh (ANC, Limpopo) asked what the development process of the code of conduct for Council board members was. She asked for clarity regarding clause 40(2) of the proposed Amended Bill - did the two-year warranty on roof repairs only come to effect when a house was occupied? She emphasised that she understood these were proposed amendments and encouraged the adoption of the C-List so that the D-List would be considered in the next meeting. Would any of the recommendations made by Committee Members be considered by provinces?

Mr C Smit (DA, Limpopo) said there had been no individual votes by each province on the proposed amendments as per the negotiation mandate, and asked why this was the case. Amendments had to be made before submission to the Portfolio Committee and publication, so it had to be clear whether provinces approved or not. He asked when the Committee would consider the proposed Bill clause-by-clause. He questioned whether it would be wise for Committee Members to vote without prior approval from their respective provinces, as per the negotiation mandate.

Responses

Mr Masemola responded by stating that the Department had met with the Western Cape Province to discuss the inputs the province had provided, resolving some in these meetings. The presentation only covered the issues raised in the mandate. The responses to the Western Cape Province had been recorded on 24 October 2023 and would be made available to Mr Badenhorst.

The code of conduct of the Council Board was to be established by the respective Minister as per the provisions of section 89(1) of the Bill and would be published before the duties of the board commenced.

The warranty cover was in action from the time of construction, regardless of whether a property was occupied or not. However, once occupied, the warranty only lasted until the first two years of occupation.

The Chairperson stated that the D-List would be considered by 1 March 2024. Upon the submission of final mandates by the provinces, a final proposed Amendment Bill would be presented to the Portfolio Committee before submission to the office of the Speaker. The views of provinces in the C-List would be included in the D-List and publicised, to ensure transparency across all communication channels. The consideration of this Bill was of utmost importance as it was the Bill that protected the rights of consumers against housing malpractices. All contributions were thus encouraged and would be encouraged. All clauses had been considered and all that was left was the adoption of the proposed Amended Bill.

Mr Sisa Makabeni, State Law Advisor, explained that the Committee had to adopt the C-List prior to its publication. This was the only step to be taken currently, as all previous steps had been taken. Provinces were still allowed to deliberate. Mr Makabeni further explained that section 65 of the South African Constitution made provisions for the powers bestowed upon the National Council of Provinces (NCOP). As such, the section stated that each province had one vote in matters such as bill amendments, and this vote would be given by the provincial delegate who was a member of the NCOP. In as much as provinces were consulted, the final decision on the recommendations to be accepted or rejected lay with the Select Committee Members. Therefore, the C-List was to be considered and adopted or objected to by the Committee Members.

Ms Thiloshini Gangen, Parliamentary Legal Advisor, supported the response by Mr Makabeni.

Voting on C List

Eight of the Committee Members, including the Chairperson, Ms Shaikh, Mr K Motsamai (EFF, Gauteng, and Ms B Bartlett (ANC, Northern Cape), moved for the adoption of the proposed Bill.

Mr Badenhorst objected to the proposed Bill and was seconded by Mr Smit.

The Chairperson acknowledged the responses by Committee Members, thanked them for their attendance and contributions, and adjourned the meeting.